GMAC Financial Posts ResCap-Linked Loss

GMAC Financial Services, New York, has posted a second-quarter net loss of $2.5 billion, of which $1.9 billion is attributable to losses at Residential Capital LLC. For the same period last year, GMAC Financial had net income of $293 million, although ResCap reported a $254 million net loss. The losses at ResCap are due to asset sales and a higher loan loss provision related to the deterioration of certain European markets, the company said. Offsetting some of the loss was a $647 million gain from a tender offer and the retirement of debt. Prime conforming loan production totaled $12.2 billion for the quarter, down slightly from $12.7 billion a year earlier, but government loan production increased from $800 million to $3.8 billion during the same period. Because of illiquidity in the global capital markets and weakened consumer credit in key markets, ResCap has suspended all its loan production outside the United States, with the exception of Canadian insured loans.